A spat of single-brand deals has followed more large-scale brand M&A in the hotel industry. Don’t expect the wave of change to subside soon.
The brand landscape keeps changing, that much is clear. After Marriott International’s purchase of Starwood Hotels & Resorts Worldwide rocked the industry a couple of years ago, I think we were all in wait-and-see mode to see which domino would fall next.
That problem was we all incorrectly assumed that the next deal or deals would be similarly earth-shattering. Everyone with a platform was saying InterContinental Hotels Group was going to buy Hyatt Hotels Corporation—or maybe Hyatt would buy IHG; that one was never totally clear. Or maybe the company formerly known as Carlson could swoop in and make a scale play? Wyndham was clearly hungry. We all (correctly) assumed Hilton was content doing what Hilton does, conjuring new brands seemingly from nothingness and relying on nothing outside of McLean, Virginia, or Memphis, Tennessee, for brand growth.
We did get RLH Corporation picking up Vantage Hospitality’s stable of brands, but that seemed to become the exception and not the norm.
Instead, what we got was a steady stream of single-brand deals that have in aggregate pretty dramatically changed the brand landscape.
Of course, the latest of these moves is RLHC’s announced deal to move Knights Inn from Wyndham Hotel Group’s stable to its own, which is something HNN’s reporting hinted to more than a week before the official announcement.
Even before that, Wyndham made a couple noteworthy single-brand deals, first picking up the Midwestern AmericInn brand before announcing plans to purchase La Quinta’s franchising and management operations as that company spinned off its owned assets into a real estate investment trust. At the same time, Hyatt is off buying spa brands, wellness brands, home-rental platforms and seemingly everything except hotel brands.
AccorHotels is taking over the world outside the U.S., and Choice Hotels International bought WoodSpring Suites.
Even as someone who makes a living observing what’s going on in this industry, it can be hard to keep track of all these moving pieces at once.
The wave of change leaves a lot of questions unanswered at this point. What exactly is RLHC’s play bringing in a new brand that’s in a segment where it already has scale? Do the WoodSpring, La Quinta and AmericInn deals spell the end to the one-brand hotel company?
Coincidentally, I asked Cobblestone Hotels’ Brian Wogernese that last question at the Hunter Hotel Conference, since his company is part of that seemingly dying breed. You’ll have to wait until next week for the full interview, but the gist of his answer was there is still room for that sort of hotel company, but it has to be willing and able to play in a space the larger public C-corps aren’t focused on.
It will be interesting to see what happens next. At least stateside, it doesn’t seem like there’s a lot more room for deals like the AmericInn or WoodSpring buys, but it could be interesting if companies start treating brands like trading cards a la the Knights Inn deal.
Or maybe Marriott will just buy everyone else and move its brand count into triple digits.
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